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Vendors in negative equity - reveals now after offer accepted!!

bargainhunterss
Posts: 792 Forumite


Previously we've had a purchase fall through because of the survey (and vendor not wanting to lower the price for the work that needed doing) so when we found the house we are currently 'buying' we were really happy! Didn't seem to need much work, ex rental so no chain etc etc. So put offer in, was accepted, survey done and all things running smoothly!
Or so we thought (you knew that was coming!)... our solicitor rings us to let us know that the vendor's solicitors have been in touch to say that with the money we have offered they won't have enough money to pay off their mortgage!! Turns out the vendor remortgaged the property and now owe around £6000 on top of what we have offered. My gripe is surely the vendor would have known what they owed on their mortgage?!?
Anyhow, still waiting 2 weeks later from ANY word from their solicitors as to whether or not they will have the money to cover the difference or if they can do a deal with their bank. I'll be damned if I'm gonna pay up more!!!! Anyone else had this problem before?
Or so we thought (you knew that was coming!)... our solicitor rings us to let us know that the vendor's solicitors have been in touch to say that with the money we have offered they won't have enough money to pay off their mortgage!! Turns out the vendor remortgaged the property and now owe around £6000 on top of what we have offered. My gripe is surely the vendor would have known what they owed on their mortgage?!?
Anyhow, still waiting 2 weeks later from ANY word from their solicitors as to whether or not they will have the money to cover the difference or if they can do a deal with their bank. I'll be damned if I'm gonna pay up more!!!! Anyone else had this problem before?
Every act of kindness, no matter how small, isn’t wasted ❤️
"It’ll be alright in the end, and if it’s not alright - it’s not the end"
Every pound we spend is a vote for the sort of world we want
2021 wins - 1
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Comments
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Like you say, they surely should have known, and shouldn't have accepted your offer. Bottom line is are you willing to pay an extra 6000 to get the house - if not walk away. Was your offer at least 6000 below their asking price?0
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Like you say, they surely should have known, and shouldn't have accepted your offer. Bottom line is are you willing to pay an extra 6000 to get the house - if not walk away. Was your offer at least 6000 below their asking price?
It was, yes. But like you say, why accept the offer?? Once we've heard back from their solicitors then we'll be able to make a decision. If they can't pay, we're walking away.Every act of kindness, no matter how small, isn’t wasted ❤️
"It’ll be alright in the end, and if it’s not alright - it’s not the end"Every pound we spend is a vote for the sort of world we want
2021 wins - 10 -
It's possible to know the balance of your mortgage but be oblivious to the early redemption penalty attached to it.
It's only at the point you give your solicitor the mortgage account details and a redemption statement is obtained that the full horror of how much is added on actually hits home.
It is shown on every annual mortgage statement and plenty of us would know what to look for and where, but it appears a lot don't!I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
A cynic might suggest that they accepted your low offer, then waited till you were financially invested (survey etc) before telling you they needed more.0
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How awful for you. What silly games some people play. I guess they hoped that when you had spent money you would be more likely to offer more, ie gazumping.Changing the world, one sarcastic comment at a time.0
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The two possibilities (it's a game to up your offer, or they got caught out by early redemption or similar) are both plausible.
I'd be telling them to get an unsecured loan for the balance, if I thought I'd given a fair offer.0 -
Hi bargainhunterss
Is the seller using an EA? If so, speed things up (and perhaps save legal fees) by using the EA as the middleman, instead of two layers of solicitors.
Solicitors send letters which sit in in-trays. An EA will phone the vendor to ask what's happening and then phone you back.
e.g. if the answer from the vendor is "I can't sell at that price", you might get the answer in 15 mins, rather than 2 weeks (and save legal fees).
And the EA wants the sale to happen, so will put pressure on the vendor. The solicitor is indifferent about whether the sale happens.
Once you have reached any agreement via the EA, then tell your solicitor, so it can be formalised.0 -
It's a nuisance but if the figures do not work for them then that's how it is. They should have established their baseline figure before putting the property on the market, you can't always know an exact figure but £6,000 is quite a difference. People make genuine mistakes, people try and play games, who knows but it is annoying when you have spent money on surveys.0
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We tried to buy a house earlier this year. The vendors wouldn't give an answer to our offer for several weeks. Turns out they had so much debt that our offer wouldn't cover it. They hadn't added it all up because they didn't really want to know. It wasn't only the mortgage but also several secured loans plus charges on the house. We bought a copy of the title from the land registry and could see it all. They've since sold to somebody for a much higher price than we were willing to pay and we bought a property listed at a fixed price.0
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I think this is very common, people who are in debt stick there heads in the sand.0
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